Shares of Wynn Resorts, Limited (NASDAQ: WYNN) are spiking more than 7.7 percent on an extremely weak day in the market after the company reported preliminary Q4 results that impressed the market. Credit Suisse analyst Joel Simkins sees Wynn’s numbers as a positive sign that the Macau market may be stabilizing, but is unwilling to upgrade Wynn from Neutral just yet.
“While we are in the camp that believes the Macau gaming market may be stabilizing and Las Vegas is firmly recovering, our Neutral rating stems from concerns around the impact of new supply and our view that investors have not properly accounted for this new capital,” Simkins explains.
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Wynn’s new guidance indicates in-line EBITDA in Macau in Q4 and better-than-expected numbers out of Las Vegas, sending shares soaring higher in Friday’s session. Despite the jump, Wynn’s stock remains down more than 20 percent already in 2016. Credit Suisse maintains a $74 price target for Wynn.
Macau-exposed stocks Melco Crown Entertainment Ltd (ADR) (NASDAQ: MPEL) and Las Vegas Sands Corp (NYSE: LVS) are trading flat to slightly up in Friday’s session, while Vegas-exposed stocks MGM Resorts International (NYSE: MGM) and Caesars Entertainment Corp (NASDAQ: CZR) are both down more than 2.0 percent.
Disclosure: the author owns shares of Melco Crown Entertainment and Wynn.